Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Jags who wrote (611)	9/8/1998 9:59:00 AM
From: Sam	Respond to of 3536

"As the dollar got stronger, the commodity prices fell. Now that the dollar is falling, the commodities have come to life. GOld and gold stocks are soaring. Oil and oil stocks are also rising. How are they related??" I would guess it is because a lot of people think that inflation in the US has remained restrained because of the strong dollar. As the dollar falls, that protection gets weaker. This combined with rising wages is the case for future inflation in the US. However, I personally don't see this, unless Asia gets out of its funk. There is still massive overcapacity in the world. Asians won't be turned around overnight. The Asian "miracle" was based on massive debt which was pegged to the dollar and thus gave these people greater buying capacity than they really had. It will take at least a generation or two to build a real consumer capacity there, and their governments don't appear to really want this, no matter what they say. This means that there will be a floor to the dollar's weakness, IMHO. Also, if business here turns down, companies will simply lay off the people that they hired, reducing their costs and the pressure to raise prices.